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January 16, 2013

DiNapoli: KeyCorp Agrees To Disclose Political Spending

Eleventh Agreement Reached, DiNapoli Continues to Urge SEC to Adopt Disclosure Rule

KeyCorp has agreed to disclose all of its corporate political spending, lobbying and employee-sponsored political contributions in a comprehensive agreement announced today by New York State Comptroller Thomas P. DiNapoli on behalf of the New York State Common Retirement Fund (Fund).

“KeyCorp has taken a positive step for transparency and corporate accountability by agreeing to reveal its political contributions,” DiNapoli said. “When companies make their corporate political donations public, shareholders can evaluate if their interests are aligned with management’s. More companies should follow the lead of KeyCorp and voluntarily disclose information that shareholders have a right to know.”

The agreement reached in late December with Cleveland-based KeyCorp, one of the country’s largest commercial banks, stems from a shareholder resolution filed by DiNapoli for 2013. The company agreed to annual disclosure on its website of the company’s ‘participation in the political and public process that impacts the lives of its customers, shareholders and business’ beginning this month. Key Bank is a vendor of services with New York State, operating New York’s primary checking account from which all payroll and vendor checks are issued.

DiNapoli has taken a comprehensive approach to engaging with the Fund’s portfolio companies to compel disclosure of political spending. In 2010, the Fund, along with other members of the Council of Institutional Investors, sent letters to 430 S&P 500 companies asking them to disclose contributions made with corporate funds. In 2011 and 2012, the Fund filed 27 shareholder resolutions seeking disclosure of political spending, reaching agreement with 10 companies. To date, DiNapoli has filed 26 resolutions for 2013 on the issue of political spending disclosure. KeyCorp is the first company to agree to disclose from this group of resolutions.

DiNapoli has written to the Securities and Exchange Commission in support of a petition, which the commission has indicated it will take up in 2013, for rulemaking regarding disclosure of political expenditures. In early January, the Fund announced that it filed suit against Qualcomm in Delaware’s Court of Chancery for the right to inspect the company’s books and records to determine how shareholder funds are being spent for political purposes.

“While KeyCorp should be lauded for agreeing to disclose its political spending, I strongly urge the SEC to move forward and consider rulemaking to require disclosure of political spending by all publicly held companies. We need comprehensive solutions on this issue,” DiNapoli said.

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